Bitcoin is the game changer, for years people have used paper money and banks for their trades but nowadays you can do almost anything with the intangible currency called Bitcoin. Bitcoin had rise and falls in the past few years but people always talk about bubbles of bitcoin and stuff so we are here to talk about “is it possible for bitcoin to go back to 100$?”. Lets see how all nuances come together.
History of bitcoin prices
As the Godfather of Smart Beta, Mr. Robert Arnott, perhaps said it best, “In investing, what is comfortable is rarely profitable.”. This is what bitcoin put it to test. Bitcoin inherently is comfortable to buy and even sell, so if you have bought 100$ worth of bitcoin 8 years ago and we wanted to test Robert’s claim, we could probabely violate the claim right away.
In 2011 Bitcoin is on the start of its journey, The price is very low and if you had 100$ you could buy each bitcoin for as little as 30 cents and get a total of 333.33 net bitcoin into your pocket (e-pocket I mean) right away (We got this data from CoinDesk bitcoin price index so they are fairly accurate). On June 8, 2011 bitcoin hit the high of 31.91$, and then it went back to 4.72$ on December 31, 2011. Just in a matter of months it had 800 percent in increase and then had the same amount in decrease in value. In 2012 bitcoin hit a steady increase from 5$ to 12$, In 2013 it hit a big ride of 1147$ followed by a big downfall in December 30, 2014.
So this data shows how volatile bitcoin is and this proves that anything is possible and we could possibly dream of anything that could happen and future events are really unpredictable.
The bitcoin price myth and how it is calculated
Why exactly does the bitcoin has a value? It may seem its just some pieces of zeros and ones on a piece of digital device, but it is more than just that. Many people actually find it very hard to understand how something which only exists digitally could have any intrinsic value at all. Actually the real answer to this question is rather simple and that brings basic economics: scarcity, supply, and demand and utility. If something is both rare and invaluable it should have value and every value can have a price on itself.
For example take gold, why does gold has so much value? Thats because it’s rare, hard to find, hard to extract and it is in a limited supply meaning that its scarce. The usefulness of gold is in its use case for beauty. People take satisfaction from wearing something that pleases eyes of others as it seems to give value to the person. These things combine and they create a value and as I said each value has a price. The price is determined by the rule of supply and demand.
But you may say what’s the point, why am I relating this basic economics thing to bitcoin?
That comes to the fact that Like gold, Bitcoin is also scarce. It’s supply is limited and there are roughly over 16.2m Bitcoin in circulation and the maximum number of coins that will ever exist is capped at 21 million. This rigid cap is the reason, making its scarcity obvious.
As we said, for bitcoin to have value it must be useful, bitcoin creates usefulness in a couple of ways. Bitcoin is similar to gold as every bitcoin is similar to another bitcoin and also you can divide it to pieces meaning that you can pay as little as a satoshi (one eighth a bitcoin). Bitcoin transactions are like transfer of gold cause they are traceable and verifiable thanks to the blockchian architecture. These characteristics make bitcoin kind of an asset which means not only it can act as a medium of exchange, it can also be used as an asset and a store of wealth.
Bitcoin price is not nearly the same as its value. Its price is decided based on the market in which it trades, by means of supply and demand. This is exactly the same way the price of your old car, a bag of apples that you bought in the supermarket, an ounce of gold and just about everything else is determined.
Traders having bank accounts around the world can trade Bitcoin on the Internet using Exchange platforms, which sets a certain price at a specific point of time for a given market. The Exchange platforms do not set the price, the traders (who are buying and selling Bitcoin) do. Lastly I have seen people saying that if you want to find the price of a coin, just find the market cap size and divide it by the available coins. This is not true! Cause as I said the price is based on each coin and the supply and demand rule. So the thing that you can calculate is the market cap and that can be done with multiplying the current price of bitcoin and the number of coins in circulation. Thats it all! The price of bitcoin is determined by trading platforms.
Is it too late to get into bitcoin?
Actually this is not a new question. This inherently was the question that people asked when bitcoin was at 10$, 100$ and 1000$ price. This is the question that all human ask all the time. The current price (as the time of writing) is 10,219.64$ according to CoinMarketCap. I remember the time when the price was at 17,000$ and everybody were screaming that “ITS GONNA GO UP, ITS GONNA GO UP, BUY NOW OR YOU WILL LOSE” but now people who listened to them are busted.
Kinda telling you, it is never too late or too soon to get into crypto. Crypto is completely unpredictable, Its unpredictable as earthquakes are to the Earth. You couldn’t and should not depend on anybody’s advice that they hadn’t any success in crypto, even if he is your uncle. If you want to invest in crypto invest in the ones that have the lowest possible value in a nearly wide time period. Get your statistics on and decide on your best possible choices and then move on.
Is there a possiblity of bitcoin going back to 100$ ?
You want to know the answer? Is it really possible for this bitcoin, the high priced bitcoin to go to 100$ of value? If you ask a pessimistic guy like me yeah it is possible and In my own opinion, anything could happen to things that we may not control. About bitcoin, there are many people who are in the 1% group and may control the price but what if they all knew each other and decide on moving out to a new industry? If that happens we could see a bump decrease in Bitcoin’s value.